Appropriate Technology, Human Capital and Development Accounting
Areendam Chanda and
Beatrice Farkas ()
Departmental Working Papers from Department of Economics, Louisiana State University
Abstract:
Over the past decade, research explaining cross country income differences has increasingly pointed to the dominant role of total factor productivity (TFP) gaps as opposed to factor accumulation. Nevertheless, it is a widely held belief that a country�s ability to absorb and implement technologies is tied to its human capital. In this paper, we implement this idea in a novel specification and explore its quantitative implications within a development accounting framework. In our model, intermediate goods production takes place over a range of industries, and relative human capital ratios in a country influence industry specific productivities asymmetrically. As a result, in human capital abundant countries, production is concentrated around industries with high TFP, while in low human capital countries, production is concentrated around industries with low TFP. Development accounting exercises for a range of parameter values suggest that this human capital-technology complementarity may account for eighteen to twenty five percent of differences in GDP per worker which is higher than the combined direct contribution of factors of production.
Date: 2012-03
References: View references in EconPapers View complete reference list from CitEc
Citations:
Downloads: (external link)
https://www.lsu.edu/business/economics/files/workingpapers/pap12_03.pdf (application/pdf)
Related works:
Working Paper: Appropriate Technology, Human Capital and Development Accounting (2012) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:lsu:lsuwpp:2012-03
Access Statistics for this paper
More papers in Departmental Working Papers from Department of Economics, Louisiana State University Contact information at EDIRC.
Bibliographic data for series maintained by ().